IHTM20221 - Policy effected by the deceased for their own benefit but gifted later: Introduction

The transfer of the policy is a transfer of value ( IHTM04024), and the claim is on the value of the policy at the date of transfer for IHT purposes. What this value is set out at IHTM20231.

In addition if the deceased paid any premiums on the policy after the transfer, each payment is also a transfer of value. The claim is on the amount of each premium ( IHTM20082).

The transfer should be notified on form IHT403 - see procedural instructions at IHTM20041 onwards.

If there is a reservation to the donor, there may be an alternative claim under the Gift With Reservation (GWR) ( IHTM14025) rules if the policy was given to a non-exempt beneficiary.